Make Yourself $419,000 Richer With This Simple Hack
This easy hack can make you $419,000 richer with a simple hack with your financial planning!
You can save up to $419,000 more by implementing this simple hack when you turn 35. The key is salary sacrificing, before you reject the idea hear me out. It could seem like something you would be reluctant to do but, it is worth it in the long run and can even make you a millionaire by the time you're in your 60s! The significant difference the small change in your superannuation can make is truly shocking!
What is superannuation and why is it important?
Superannuation is essentially your retirement fund, and it's more important than you think.
You know why? Because Aussies believe that they need 1million dollars to have a secure retirement assuming they retire at the age of 67. So it will help if you know how much money you actually have in your superannuation and how you plan on growing your funds.
Salary sacrificing isn't just a smart way to grow your retirement fund but it's also an advisable long term wealth strategy.
What is salary sacrificing?
Salary sacrificing means you can an arrangement with your employer for an agreed amount to be deducted from your pre-tax pay and put towards your super.
If you want to have a million-dollar superannuation fund by 67. Then by the time you're 35 you need to start salary sacrificing. A 35-year-old Aussie worker earning the typical annual income of $77,948 would have a starting super balance of $61,247.
Most Aussies choose a super contribution that is a minimum mandate by the government, keeping that in consideration (and considering the average $77,948 per year) you will have about $694,275 by the time you turn 67. However, you can have $109,000 - $419,000 more depending on how much % salary sacrifice you choose to implement. You can salary sacrifice into their superannuation up to a concessional contribution maximum of $27,500, including the employer contribution.
Would this affect how I am taxed?
Yes, the amount you choose to transfer to your superannuation will also be taxed lower i.e 15% instead of what is usually a higher marginal tax rate.
How do I know how much money will I really need by the time I retire?
The Association of Superannuation Funds of Australia estimates that the amount needed by a couple retiring in 2021 to live comfortably in retirement was $640,000.
Although they have recommended a start of salary sacrificing at the age of 35, you can also start early which means the amount you sacrifice can be significantly lower and still leave you with savings that you can invest and spend elsewhere.
Wish they taught us about this in school. However they don't, so we got you instead!
If you don't have the patience to wait until you retire you can also make some quick money by getting paid $95,000 just to watch Netflix and $6000 to watch reality game shows.